THE RIDDLE OF THE STANDARDS – WHEN WILL THE ISA EXPLOITATION RULES BE COMPLETE?

The Riddle of the Standards
Rechtsanwalt Andreas Kaede
Lammstrasse 6
D-70839 Gerlingen
Germany
Tel. +49 7156 433 100-103
Cell: +49 173 928 70 20
Mail: andreas.kaede@t-online.de
Web: www/kanzlei-kaede.de

London, May 4, 2023 ANDREAS KAEDE, ATTORNEY-AT-LAW 2
Disclaimer:
The following presentation sets out the personal
findings and opinions of the author. It is not intended
to provide (a) a comprehensive treatise on the subject,
or (b) legal advice in any manner.

2023 – the year of the ISA Exploitation Rules?
 Target: for the Draft Rules to be approved at least by the ISA Council in Summer 2023
 Status: batches of the main body of the Draft Rules (in all: 107 regulations, 10 annexes, 1
schedule  117 pp) under review at the Council, entailing substantial „redline“
 Extra challenge: some 40-50 Standards and Guidelines implementing or accompanying
the Rules are supposed to be in place at about the same time as the Rules.
Let‘s talk about this „extra challenge“ today.

Overview:
1. 2023 – the year of the ISA Exploitation Rules?
2. Standards & Guidelines: Planned – drafted – pending
3. Plan and reality
4. Status of, and challenges for, S&G drafting
5. Future Scenarioes
6. Outlook

Standards & Guidelines („S&G“) planned – drafted - pending
Legal Office (in
Secretariat)
(8 employees)
Legal and Technical Commission LTC
( 41 members )
Council (36 members)
Assembly (160+ members)
„The Authority“ or
„ISA“ (Section 4,
Arts. 156 et seq. of
UNCLOS)
Standards
Exploitation Rules Guidelines
issue
issue
Issue for
provisional
application
final issue
report

2. Standards & Guidelines („S&G“) planned – drafted - pending
In general:
 Standard: usually a feature or property to be consistently found in a variety of things,
processes or situations. Standards may be factual or normative.
 Guideline: a statement by which to determine a course of action. Guidelines may be
mandatory or non-mandatory.
In the ISA Draft Rules:
 Draft Regulation 94 provides for the adoption of Standards (normative) mainly in the
fields of operational safety, resource conservation and environmental matters.
 Draft Regulation 95 provides for the issuance of Guidelines (non-mandatory, without
saying so) to support the implementation of the regulations of the Rules from an
administrative and technical perspective.
 Details of which organ of ISA is to approve either type of instrument, and the related
process, belong to the more contentious matters in the present Council debates on the
Draft Rules.

2. Standards & Guidelines… (2)
Relevance of the S&G for the mining industry:
 The applicant for an exploitation license, or – once this is granted – the contractor, should
expect the following from the Rules in combination with S&G:
 The Rules to tell him on a more abstract level, what is required, e.g. „undertake an
Environmental Impact Assessment (EIA) and, based thereon, generate and submit an
Environmental Impact Statement (EIS)“
 The Standard to tell him what quality, properties, or values the required deliverable
(e.g. an EIS) or action (e.g. EIA) must fulfill
 The Guidelines to show him a recommended procedure for attaining those qualities,
properties, or values

Example: Application for Approval of a Plan of Work: Formal requirements as per Draft
Regulation 7 of the actual Draft Rules
Main Document
with data,
commitments
and information
as for
exploration
Mining Workplan
Financial Plan
Environmental
Impact
Statement
Emergency
Response &
Contingency
Plan
Health & Safety
Plan
Training Plan
Environmental
Management &
Monitoring Plan
Closure Plan
G S&G S&G G G G

Which S&G were planned, which are drafted by now, and which are pending? Concept: Issue in 3
batches („Phases“) according to relevance: Phase 1 along with issue of the Rules, Phase 2 before
receipt of 1st. Application for Exploitation license, Phase 3 at start of commercial mining. Reference for
what is planned: Outcome of Pretoria Workshop 2019. Phase 3 S&G (9 entries) not shown on these
slides.
Phase: 1
Status:
Green = issued
Yellow = before
Council
Red = unknown,
not yet seen
Topic Standard Guide-
line
Phase status Remarks
Application Plan of Work x 1
EIA process x x 1
EIS preparation x 1
Env Mgmt & Monitoring Plan prep x 2? transferred to 1
by LTC
Idem, corr 1 x 2?
Env. Mgmt System development & prep x x 1
Hazard Identif. & Risk Assessment tools x 1
Safe Operation Mining Vessels & Installations x x 2? transferred to 1
by LTC
Environmental Performance Guarantee x x 1
Baseline Environmental Data x 1
Emergency Response Plans x x 1

Phase: 1 cont‘d
Status:
Green = issued
Yellow = before
Commission
Red = unknown,
not yet seen
line
Risk based approach generic thresholds & indicators x 1 Necessity to to
reconsider
Access to environmental data x 1
Stakeholder participation x 1 Separate policy?
Exploitation contract as security x 1
Application of good industry practice x 1 Depending on
definition in
Rules
Determination of date of commercial production x 1 idem
Insurance requirements and risk allocation x 1
Modification of plan of work & meaning of material
change
x 1
Transfer of rights & obligations under an
exploitation contract
x 1

Phase: 2
Status:
Green = issued
Yellow = before
Commission
Red = unknown,
not yet seen
line
Health + safety management system x 2/1 Pretoria:
commission to
determine need.
Comm trans-
ferred 2 to
Phase 1
Safe operation x 2/1
Maritime security x 2
Mapping of seabed habitats + ressources x 2
Management + monitoring plans x 2/1 comm.
Transferred to
phase 1
Monitoring + result evaluation of environmental
effects
x 2
Preparation of closure plans x 2
Application of “reasonable regard” x 2 Pretoria:
Commission to
determine need
Health + safety management system x 2

Phase: 2
Status:
Green = issued
Yellow = before
Commission
Red = unknown,
not yet seen
line
Application of “best available techniques” x 2 Pretoria: may be
covered by
improved
definitions
Best environmental practice x 2
Best available scientific evidence x 2
Change of control x 2
Application of “as much as reasonably practicable” x 2
Annual and other reporting under expl. Contract x 2
Review of activities under a plan of work x 2
Adoption of labour rules x 2 Pretoria: check
coverage by IMO
instruments
Formal safety assessment x 2
Performance assessment x 2
Adaptive management measures x 2
Notifiable events x 2
Royalty returns x 2
Enforcement and penalties x 2

3. Plan and reality
Wherever there was a plan with respect to the preparation and adoption of S&G, this appears
to have changed over time. Several „roadmaps“ emerged over time, yet they mainly planned
meetings and subject matters, however no real targets.
 Draft of 8 Aug 2017, DR 80: First mentioning of „recommendations for the guidance of
contractors to assist in the implementation of the Rules“, to be issued „from time to time“
(ISBA/23/LTC/CRP.3) i.e. after entry into force of the Rules
 Draft of 30 April 2018, DRs 92, 93: corresponding, but „Standards“ added
(ISBA/24/LTC/WP.1)  remained in Draft before Council as DRs 94, 95 (ISBA/25/C/WP.1)
 Stakeholder Consultation 2019:  need to prepare S&G early, partly along with Rules
 Council 2019: prepare S&G in 3 phases (1) to issue with Rules, (2) to issue before receipt
of 1st. Application for exploitation license, (3) to issue at start of commercial mining
 Pretoria Workshop May 2019 with outcome: revised 3-phase-list, 50 + S&G

3. Plan and reality (2)
 2020-2021:
 LTC concentrating on phase 1 S&G, incl. 2 Shareholder Consultation rounds.
Corona prevents/impedes regular live meetings for major parts of the time
 2021:
 June: Nauru notifies of intention to submit application for approval of a plan of
work for exploitation (= appl. for exploitation license)  Rules to be complete 9 July
2023 pursuant to Annex, Section 1 Art. 15 of the 1994 UNCLOS Amendment
 August: Council requests setup of 3 informal working groups to i.a. deal w/S&G
 November: ISA solicits external counsel support for preparation & finalization of
all Phase 2 S&G, plus harmonization thereof and of Phase 1 S&G with Rules, w/target
to have them ready (incl. iterations) at the planned issue date of the Rules mid 2023
 2022:
 Submission of first 10 Phase 1 S&G by LTC to Council in January; status unknown.
 2023:
 Inquiry on whether/how a review of a possible exploitation license application by
Nauru could be deferred
 LTC foresees another up to 5 years for the finalization of Phase 2, 3 S&G

4. Status of, and challenges for, S&G drafting (2)
Status:
 Of the 39 S&G originally contemplated for phases 1 and 2, 10 are drafted and before the
Council. 5 of them come in a pair (Standard plus Guideline)
 Of the 10 drafted S&G documents,
 All, as we learned, will need alignment with the Rules text once that is „stable“
 Most might need intra-document review, by lawyers or comparable resource, in one or
more of the following aspects
 Putting „teeth“ to Standards by formulating unambiguous requirements
 Checking and possibly adjusting relationship between „Guideline-part“ and „Standard-
part in a S/G pair
 Concentrating Guidelines more on „how to do it“
 Removing overlapping language between Standard and Guideline in a S/G pair
 As said: Some of the listed, yet undrafted S&G await decision of LTC/Council as to whether they
will at all be required

4. Status of, and challenges for, S&G drafting
Challenges:
 Corona (formerly) and multitude of statements in Council in the way of more systematic &
accelerated discussion of the Rules
  S&G (even phase 1) cannot be properly addressed in Council before Rules are more
stable
 Rush prompted by the Nauru initiative leads to unplanned „last minute action“ also affecting LTC
 Demand by Council to all ISA organs to find ways & means to defer review of possible
application for „plan of work“ approval
 Task from Council to LTC to develop new Standards on „environmental threshold values“
  hardly time & resource at LTC/Secretariat for creating new S&G (from the list)

5. Future Scenarioes
With about two months to go until the „Nauru date“ (9 July 2023), and looking at the S&G drafting
status to-date, it may be allowed to ask: „what if?“ ---
1. The (phase 1) Standards issue too late?
2. The phase 1 Guidelines issue too late?
3. One or more phase 2 or 3 Guidelines issue too late or not at all?
4. One or more Standards or Guidelines are revoked?

6. Outlook
The debate on Deepsea Mining is supposed to become more heated in the future:
 On the one hand, the recent finalization (pending lawyer‘s review, signatures, & ratifications) of
the BBNJ Convention, along with the intent expressed in the Montreal conference 2022 to make
30% of the planet environmental protected areas by 2030, is likely to increase critcism of
planned DSM activities.
 On the other hand, many raw materials also extractable from the seafloor face increasingly
severe shortage risks from their land based sources: wars, sanctions and export restrictions
already now lead to major supply chain problems. This – once again – directs the interest of
many States and mining companies to the seafloor.
 If the deadline triggered by Nauru expires with Rules / S&G pending effectiveness for some time
to come, and if no way is found to interpret the UNCLOS provision in a way allowing to defer
review of applications for exploitation licenses, then the rules governing first deepsea mining will
be quite basic at best. Setbacks this may cause for the preservation of the marine environment
may not only entail ecological damage, but also a potentially irreparable harm to the efforts to
establish a DSM system implementing in a balanced way all aspects of the concept of Common
Heritage of Mankind.

Thank you for your attention and
patience.
And have a safe voyage home!

THE RIDDLE OF THE STANDARDS – WHEN WILL THE ISA EXPLOITATION RULES BE COMPLETE?

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